Policy Schemes for Supporting Small Scale Solar Power Generation in Georgia

Abstract

This policy paper analyzes current regulatory framework on the Georgian electricity market, to find space and opportunities for integrating needs of solar generation growth. It studies different components of electricity market regulatory framework to find the ways of improvements under current vertically integrated electricity market. Although, there is lack of data Levelised Cost of Electricity Generation (LCOE) is calculated, as an important cost indicator of solar photovoltaic for households and businesses (IRENA). Through reviewing international case studies this paper suggests different policy initiatives from above three clusters. It also reviews Georgia’s tax code (including customs provision) for finding space to integrate needs of solar power development in government’s fiscal policy. This policy paper is organized in the following manner: Section 2 defines methodology of calculating LCOE and provides major assumptions. Section 3 provides results of LCOE calculations for six different scenarios and compares them to current electricity tariffs in the country. Section 4 reviews international experience, opportunity to integrate it in Georgia, defines costs for different policy interventions and makes recommendations on the best options. Section 5 concludes the policy paper and summarizes main results.